Deutsche EuroShop | Company Presentation | 03/12

COMPANY PRESENTATION

09.03.2012

03/12

Equity Story

Deutsche EuroShop is Germany´s only public company that invests solely in shopping centers.

Shopping centers are attractive investments because of – continuously positive development of rents – stable long term growth – prime locations – high quality standards

Deutsche EuroShop does not seek short-term success, but rather long-term growth and the resulting stable increase in the value of the portfolio.

09.03.2012 COMPANY PRESENTATION

2

COMPANY

At a Glance

19 shopping centers on high street and in established locations – 15 in Germany, 2 in Poland and one each in Austria and Hungary

2011 portfolio valuation: 5.92% net initial yield (EPRA)

Professional center management by ECE, the European market leader in this industry


3

COMPANY

* 100%-view

Lettable space* approx. 905,000 sqm*

Retail shops approx. 2,310*

Market value approx. €3.6 billion*

Rents per year €244 million*

Occupancy rate 99%

avg. lettable space per DES-center: inner city 37,060 sqm est. Locations 102,000 sqm

Key Figures1)


4

COMPANY

1) Preliminary results 2) 2006-2011, Compound Annual Growth Rate (CAGR) 3) Proposal to the AGM 4) EPRA NAV

REVENUE €m

EBIT €m

NUMBER OF SHARES mn

FFO PER SHARE €

DIVIDEND PER SHARE €

NAV PER SHARE €

34.37 34.37 34.37

51.63 51.63

2007 2008 2009 2010 2011

1.12

1.38 1.40 1.35

1.61

2007 2008 2009 2010 2011

1.05 1.05 1.05

1.10 1.103)

2007 2008 2009 2010 2011

26.91 27.43 26.63 26.374)

27.654)

2007 2008 2009 2010 2011

+11%2)

+0.6%2) +1.2%2) +10%2)

95.8 115.3

127.6 144.2

190.0

2007 2008 2009 2010 2011

+19%2)

78.5 98.1

110.7 124.0

165.7

2007 2008 2009 2010 2011

+21%2)

Lease System


5

COMPANY

years

Lease standards:

10 years lease only

no break-up option

turnover-linked rents

minimum rents are CPI-linked

Participation in sales growth of retail industry

0

1

2

3

4

5

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15

CPI-linked minimum rent

turnover-linked rent

rent

Lease System

avg. rent per sqm and year: €250

avg. turnover per sqm and year: €4,700 (avg. German retail: €3,430)

Rent-to-sales-ratio: 7-11%

weighted maturity of rental contracts: 7.4 years


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COMPANY

61.4 72.1

92.9 95.8

115.3

127.6

144.2

190.0

2.6% 2.8%

2.20% 2.4%

2.0% 1.8% 1.8% 1.7%

40

65

90

115

140

165

190

0%

1%

2%

3%

4%

5%

2004 2005 2006 2007 2008 2009 2010 2011

Revenue Rate of turnover-linked rent

0%

1%

2%

3%

4%

2005 2006 2007 2008 2009 2010 2011

German inflation DES´like-for-like revenue

Targets

Long term net asset value enhancement

Main focus on NAV and dividend

“buy & hold”-strategy, Continuous growth

Stable and attractive dividends Dividend yield: currently 4.2%

Investment-focus: At least 75% Germany and up to 25% Europe

Portfolio extension by 10% per year – by acquisition of new shopping centers – by increasing existing amounts of holdings – by expansion of portfolio centers


7

COMPANY

Overview


8

SHOPPING CENTERS

Germany


9

SHOPPING CENTERS

A10 Center Main-Taunus-Zentrum Altmarkt-Galerie

Location Wildau/Berlin Sulzbach/Frankfurt Dresden

Investment 100% 52.0% 67.0%

Lettable space sqm 118,500 117,900 77,000

Parking 4,000 4,500 500

Number of shops approx. 200 approx. 170 approx. 200

Occupancy rate 100% 100% 93%

Catchment area approx. 1.2 m. inhabitants approx. 2.2 m. inhabitants approx. 1.0 m. inhabitants

Opening/refurbishm. 1996 / 2011 1964 / 2004 / 2011 2002 / 2011

Germany


10

SHOPPING CENTERS

Rhein-Neckar-Zentrum Allee-Center Billstedt-Center

Location Viernheim Magdeburg Hamburg

Investment 100% 50% 100%


Parking 3,800 1,300 1,500




Opening/refurbishm. 1972 / 2002 1998 / 2006 1969 / 1977 / 1996

Germany


11

SHOPPING CENTERS

Phoenix-Center Forum Allee-Center

Location Hamburg Wetzlar Hamm

Investment 50.0% 65.0% 100%


Parking 1,600 1,700 1,250




Opening/refurbishm. 2004 2005 1992 / 2003 / 2009

Germany


12

SHOPPING CENTERS

City-Galerie Rathaus-Center City-Arkaden

Location Wolfsburg Dessau Wuppertal

Investment 100% 100% 100%


Parking 800 850 650




Opening/refurbishm. 2001 / 2006 1995 2001 / 2004

Germany


13

SHOPPING CENTERS

City-Point Stadt-Galerie Stadt-Galerie

Location Kassel Passau Hameln

Investment 100% 75.0% 100%


Parking 220 500 500




Opening/refurbishm. 2002 / 2009 2008 2008

Europe


14

SHOPPING CENTERS

Galeria Bałtycka City Arkaden Árkád

Location Gdansk, Poland Klagenfurt, Austria Pécs, Hungary

Investment 74.0% 50.0% 50.0%


Parking 1.050 880 880




Opening/refurbishm. 2007 2006 2004

Europe


15

SHOPPING CENTERS

Galeria Dominikanska

Location Wroclaw, Poland

Investment 33.3%

Lettable space sqm 32,900

Parking 900

Number of shops approx. 100

Occupancy rate 99%

Catchment area approx. 1.0 m. inhabitants

Opening/refurbishm. 2001

Our Tenants


16

SHOPPING CENTERS

http://www.marc-o-polo.com/index.php?radContentId=r3_21308169442a78b67523c15

http://www.sustainable-palmoil.org/images/members/BodyShop.jpg

http://www.ansons.de/ansons_neu/de/navigation/home/home.html

Tenants Structure Top 10 Tenants*


17

SHOPPING CENTERS

Low level of dependence on the top 10 tenants

* in % of total rents as at 31 December 2011

Metro Group 6.0%

Douglas Group 4.4%

H&M 2.7%

New Yorker 2.3%

Deichmann 1.9%

Peek & Cloppenburg 1.9%

C&A 1.7%

REWE 1.6%

Inditex Group 1.4%

Esprit 1.4%

Total 25.3%

Other tenants

Total 74.7%

Maturity Distribution of Rental Contracts*


18

SHOPPING CENTERS

* as % of rental income as at 31 December 2011

Long-term contracts guarantee rental income

Weighted maturity 7.4 years

2017 et sqq: 69%

2012: 3%

2013: 2%

2014: 8%

2015: 8%

2016: 10%

Sector and Retailer Mix*


19

SHOPPING CENTERS

Balanced sector and retailer diversification

fashion 50%

non-food/electronics

21% department stores 11%

food 7%

health & beauty 6%

catering 4%

services 1%

inter-/national retailers 47%

regional retail chains 24%

local entrepreneurs 29%

* as % of rental income as at 31 December 2011

Key Figures 2011 (Preliminary Results)


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FINANCIALS

€ million 2011 2010 +/- Revenue 190.0 144.2 32% Net operating income 171.6 129.0 33% EBIT 165.7 124.0 34% Net finance costs -79.1 -60.2 -31% Valuation result 41.8 33.1 26% EBT 128.4 97.0 32% Consolidated profit 93.4 -7.8 FFO per share 1,61 1,35 19% Earnings per share 1,81 -0,17

€ million 31.12.2011 31.12.2010 +/- Total equity 1,472.9 1,441.5 2% Interest bearing debt 1,472.1 1,288.2 14% Other debt 69.3 49.1 41% Total assets 3,225.1 2,963.6 9% Equity ratio 45.7% 48.7% LTV ratio 47% 47%

Loan Structure*


21

FINANCIALS

* as of 31 Dec. 2011

Interest lockin Duration

Principle amounts (€ thousand)

Share of total loan

avg. interest rate

Up to 1 year 137,598 9.4% 3.47%

1 to 5 years 3.60 589,811 40.2% 4.87%

5 to 10 years 9.49 600,368 40.9% 4.52%

Over 10 years 15.27 139,254 9.5% 4.73%

Total 2011 6.58 1,467,031 100.0% 4.59%

5.50 5.36 5.33 5.27

5.03

4.59

0

1

2

3

4

5

6

7

8

4.00

4.50

5.00

5.50

6.00

2006 2007 2008 2009 2010 2011

avg. interest rates weighted maturities

yrs %

Banks: 23 German and 1 Austrian

Weighted maturity of fixed interest periods 6.6 years

Weighted maturity of the loans >15 years


22

FINANCIALS

Refinancings of 2011 in € thousand new old +/-

Principle amounts 300,000 305,000 -5,000

Duration 8.6yrs 2.4yrs +6.2yrs

Interest rate 4.07% 5.42% -1.35%

Maturities until 2016*

in € thousand

(re-)financing planned in

2012

end of fixed interest periods respectively

expiring loans

avg. interest

rate

regular redemption

payments total

maturities

2012 (new) 60,000 0 22,100 22,100

2013 176,600 3.75% 19,400 196,000

2014 65,600 93,600 5.84% 18,800 112,400

2015 78,600 5.06% 17,300 95,900

2016 171,500 5.43% 14,000 185,500

* as of 31 Dec. 2011

Valuation* – Investment Properties 2011


23

FINANCIALS

* External appraisers: Feri Research and GfK GeoMarketing

1) Status: 31 Feb 2012

Discounted cash-flow method 2010 2011 actual

expected yield of 10-year German federal bonds 4.44% 4.34% 1.92%1) average applied risk premiums 2.21% 2.34% average discount rate 6.65% 6.68% average property operating and management costs 11.70% 11.80% net initial yield (EPRA) 5.89% 5.92%

Macro-location 20.0% Competitive environment 6.4% Micro-location 9.6% Property quality 4.0% Tenants risk 10.0%

6.56 6.54 6.44 6.38 6.68 6.80 6.65 6.68

5.48 5.46 5.39 5.40 5.64 5.82 5.89 5.92

2004 2005 2006 2007 2008 2009 2010 2011

discount rate net initial yield

in € thousand Basis change of -25bps change of +25bps Rent increase rates 1.70% -106,300 111,700 Discount rate 6.68% 98,100 -93,300 Net initial yield 5.92% 138,000 -126,800 Cost ratio 11.80% 9,000 -9,000

Sensitivity analysis


24

FINANCIALS

Forecast

REVENUE €m

EBIT

€m

EBT BEFORE VALUATION

€m

FFO PER SHARE €m

1.12 1.38 1.40 1.40

1.61

2007 2008 2009 2010 2011 2012 2013

38.9 48.7 54.9 63.9

1 2 3 4 5 6 7

77.2 98.1 110.7 124.0 165.7

147-151

151-155

95.8 115.3 127.6 144.2

190.0 178-182

+20%

+27%

+25%

+23%

+11%

+13%

+13%

+1%

+13%

+12%

+16%

+0%

+32%

+34%

+36%

+15%

+10%

+8%

+6%

+3%

CAGR1): +19%

207-211

174-178

CAGR1): +21%

CAGR1): +22%

CAGR1)4): +9%

+2%

177-181

+3%

86.5 90-93 94-97

+4%

1.64-1.68 1.70-1.74

20122) 20133)

+4%

1) Compound Annual Growth Rate (CAGR) 2007-2011 2) incl. at-equity consolidation scenario 3) at-equity consolidation 4) incl. dilution


25

SHOPPING CENTER SHARES

Dividend & Performance

PERFORMANCE

DES DAX

1 year (2011) -14.4% -14.7%

3 years +16.4% = +5.2% p.a. +7.0% p.a.

5 years +9.1% = +1.8% p.a. -2.2% p.a.

Since IPO (2001) +104.8%= +6.7% p.a. -0.8% p.a.

Dividend1) Share price2)

0.96 0.96 0.96

1.00

1.05 1.05 1.05 1.05

1.10 1.103)

16.88 19.26

23.73

28.08

23.50 24.30 23.67

28.98

24.80 26.15

5.00

10.00

15.00

20.00

25.00

30.00

0.90

0.95

1.00

1.05

1.10

1.15

1.20

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 1) respectively paid for the previous financial year 2) 2012: as of 5 March 2012 3) proposal to the AGM

Shareholder Structure


26


* Status: 1 March 2012

9,900 shareholders

Free float 85.0%

Institutional Investors 49.8%

Private Investors

29.2%

Otto Family 15.0%

Hertie Foundation 3.0%

BlackRock 3.0%

USA 6%

Germany 74%

UK 6%

FR 3%

BE 4% CH 2%

Other 5%

Analysts‘ Consensus*


27


* according to EPRA survey 3/2011

avg. / in € 2011 2012 EBIT (€ million) 161.4 175.5 FFO per share 1.50 1.66 EPS 1.52 1.90 Dividend 1.12 1.18 Price target 27.78

Status: 7 Mar 2012

28 analysts: one of the best covered real estate companies in Europe*

Sell Underperform Neutral Outperform Buy

Baader Bank Bankhaus Lampe Bank of America

Merrill Lynch Berenberg Bank Close Brothers

Seydler DZ Bank Hamburger

Sparkasse

Green Street Advisors

Credit Suisse Kempen & Co. Kepler Capital

Markets Petercam Bank

ABN Amro Aurel Deutsche Bank HSBC ING Natixis

Commerzbank Edge Capital equinet West LB

Metzler M.M. Warburg

& Co Rabobank Silvia Quandt

Bank Societe

Generale UBS

0%

50%

100%

Q2 04

Q3 04

Q4 04

Q1 05

Q2 05

Q3 05

Q4 05

Q1 06

Q2 06

Q3 06

Q4 06

Q1 07

Q2 07

Q3 07

Q4 07

Q1 08

Q2 08

Q3 08

Q4 08

Q1 09

Q2 09

Q3 09

Q4 09

Q1 10

Q2 10

Q3 10

Q4 10

Q1 11

Q2 11

Q3 11

Q4 11

Q1 12

positive neutral negative

10 Reasons to Invest

1. The only public company in Germany to invest solely in shopping centers

2. Prime locations

3. Proven, conservative strategy

4. Stable cash flow with long term visibility

5. Shareholder-friendly dividend policy

6. Experienced management team

7. Excellent track record

8. Centers almost 100% let

9. Inflation-protected rental agreements

10.Solidity combined with growth potential


28

SHOPPING CENTER SHARE


29

APPENDIX

Key Data of the Share

Listed since 02.01.2001 Nominal capital €51,631,400.00 Outstanding shares 51,631,400 Class of shares Registered shares Dividend 2011* €1.10 52W High €29.18 52W Low €22.05 Share price (05.03.2012) €26.15 Market capitalisation €1.35 billion avg. turnover per day last 12 months (XETRA) 125,400 shares

Indices MDAX, EPRA, GPR, MSCI Small Cap, EURO STOXX, STOXX Europe 600

Official market Prime Standard Frankfurt and XETRA

OTC market Berlin-Bremen, Dusseldorf, Hamburg, Hanover, Munich and Stuttgart

ISIN DE 000 748 020 4 Ticker DEQ, Reuters: DEQGn.DE Market makers Close Brothers Seydler, WestLB

* proposal for AGM on 21. June 2012

Purchasing Power Maps


30

APPENDIX

Our partner: ECE

ECE develops, plans, builds, leases and manages large commercial real estate in the sectors shopping, office, industries since 1965

originally ECE was an abbreviation for the German word Einkaufscenterentwicklung (Shopping center development)

100% privately owned by the Otto family

active in 15 European countries

European market leader in the shopping center business

Assets under management: – 132 shopping centers – 4.2 million sqm overall sales area – approx.14,000 retail businesses – €15.3 billion in annual sales

MANY INVESTORS RELY ON ECE:


31

APPENDIX

Environment

Climate protection is one of the most important issues for Deutsche EuroShop. We believe that sustainability and profitability, the shopping experience and environmental awareness do not have to be opposites. Long-term thinking is part of our strategy. This includes playing our part in environmental protection.

In 2010, with the exception of the A10 Center, all our German shopping centers had contracts with suppliers that use regenerative energy sources such as hydroelectric power for their electricity needs. The “EnergieVision” organisation certified the green electricity for eleven of our German centers with the renowned “ok-power” accreditation in 2010. From 2011 onwards, all centers in the Deutsche EuroShop German portfolio will be powered by green electricity. We plan to switch the centers in other countries to green electricity as well in the next few years.

The twelve participating centers used a total of around 47.8 million kWh of green electricity in 2010. As a result, based on conservative calculations this meant a reduction of around 18,800 tonnes in carbon dioxide emissions – this equates to the annual CO2 emissions of around 850 two-person households. We have already reduced the energy consumption of our shopping centers by using heat exchangers and energy-saving light bulbs.

Deutsche EuroShop, through its shopping centers, also supports a range of activities at local and regional level in the areas of ecology, society and economy.


32

APPENDIX

Financial Calendar


33

APPENDIX

2012

09.03. Preliminary Results FY2011

15.–16.03. Kempen & Co. Property Seminar, New York

20.03. Roadshow Munich, Baader Bank

21.03. Roadshow Zurich, WestLB

21.03. Roadshow London, BoAML

22.03. Roadshow Amsterdam, Commerzbank

22.03. Roadshow Paris, Kepler

27.03. Roadshow Hamburg, equinet

03.04. Deutsche Bank's VIP Real Estate Event, Frankfurt

19.04. Commerzbank Corporate Day, London

26.–27.04. Bankhaus Lampe Deutschland-Konferenz, Baden-Baden

27.04. Publication of the Annual Report 2011

15.05. Interim report Q1 2012

22.05. Metzler Property Day, Frankfurt

23.05. CA Cheuvreux Pan-Europe Forum, London

30.05. Kempen & Co. European Property Seminar, Amsterdam

11.06. Roadshow Vienna, Berenberg

21.06. Annual General Meeting, Hamburg

14.08. Interim report H1 2012

16.08. Roadshow Edinburgh, M.M. Warburg

04.–05.09. Kempen & Co. German Property Seminar, Berlin

05.09. Bank of America Merrill Lynch pre-EPRA Event, Berlin

06.–07.09. EPRA Annual Conf., Berlin

13.09. Roadshow Amsterdam, Rabo

18.09. Roadshow Copenhagen, equinet

19.09. Roadshow Helsinki/Stockholm, Berenberg

26.09. UniCredit Kepler German Investment Conference, Munich

27.09. Baader Investment Conference, Munich

09.10. ExpoREAL, Munich

17.10. Roadshow Brussels, ING

13.11. Nine-month report 2012

Contact

Deutsche EuroShop AG Investor & Public Relations Oderfelder Straße 23 20149 Hamburg

Tel. +49 (40) 41 35 79 - 20 / -22 Fax +49 (40) 41 35 79 – 29 E-Mail: [email protected] Web: www.deutsche-euroshop.com

Important Notice: Forward-Looking Statements

Statements in this presentation relating to future status or circumstances, including statements regarding management’s plans and objectives for future operations, sales and earnings figures, are forward-looking statements of goals and expectations based on estimates, assumptions and the anticipated effects of future events on current and developing circumstances and do not necessarily predict future results.

Many factors could cause the actual results to be materiallydifferent from those that may be expressed or implied bysuch statements.

Deutsche EuroShop does not intend to update these forward-looking statements and does not assume any obligation to do so.


34

APPENDIX

Patrick Kiss Head of Investor & Public Relations

Nicolas Lissner Manager Investor & Public Relations

Claus-Matthias Böge Chief Executive Officer

Olaf G. Borkers Chief Financial Officer

ir-mall.com facebook.com/euroshop flickr.com/desag slideshare.net/desag twitter.com/des_ag youtube.com/DeutscheEuroShop

Investor Relations

Deutsche EuroShop | Company Presentation | 03/12